ISLAMABAD: The Sindh government is expected to allocate Rs70 billion to the agriculture sector under the Annual Development Programme 2018-19, with increased investments in crops, livestock and fisheries.

The proposed allocation will be in line with the new Sindh Agriculture Policy, 2018-2030 which has been approved by the provincial cabinet. The new policy emphasised the need to increase public investment in crops, livestock and fisheries.

The actual spending on agriculture, including crops, livestock, fisheries, forestry and irrigation, has averaged Rs20 billion over the past five years to 2016-17 of which over 80 per cent was for irrigation. Allocation levels for agriculture in 2017-18 have been increased dramatically to Rs64bn, showing an increase of 80pc over the allocation of 2016-17.

While the overall allocation is roughly in line with the requirements, the increase is largely for irrigation, mainly canal lining. Allocations for other activities have stayed virtually unchanged.

Agricultural GDP in Sindh is estimated at about Rs1,600bn, and in order to achieve a 5pc growth rate, a total investment — both public and private — in agriculture would need to be around 20pc of agricultural GDP (equivalent to Rs320bn per annum).

A review of overall levels of public expenditures on agriculture suggests two major weaknesses. Firstly, actual expenditures are generally well below allocations. The Departments of Agriculture and of Livestock and Fisheries were allocated almost Rs13bn in 2016-17 but actual expenditures were only Rs4bn — less than 25pc. In part, this is due to slow and late release of funds and partly due to financial, procurement, and expenditure issues within the departments.

Secondly, much of annual allocations, as well as actual spending are allocated to ongoing projects, which have already been approved, leaving little space for changing priorities or taking on new programmes and projects.

The new policy suggests that an efficient public investment programme needs to focus on key common-property infrastructure, public goods, and on regulatory functions, and as much as possible it should facilitate and encourage private investment. In a stable and well-functioning macroeconomic and political environment, each rupee should mobilise four to five times that in private investment, according to the policy.

The policy implies very substantive changes in the legislative and regulatory framework in the agriculture sector, in the work and functioning of the two concerned departments, and in the focus and scope of the public investment programmes. Undertaking such a change process is likely to prove difficult, and “business as usual” arrangements are unlikely to prove effective. There is a need to provide high level management and oversight to the process, along with technical support and guidance to line managers.

The timeline of the Agriculture Policy will be until 2030 to align with the internationally agreed Sustainable Development Goals. However, various legal, regulatory, institutional and expenditure-related changes set out in the Policy would be implemented over a two year period (2018-20).

The policy document says that yields in Sindh for many crops and livestock are well below potential and generally lower than in neighbouring regions. More critically, economic returns to water, which is one of the major limiting factors for expansion; and to labour which is a major determinant of incomes and living standards — are low.

On the other hand, in several areas where small to medium scale progressive farmers, or corporate farms using leased land, are taking the lead in high-tech commercial farming, yields and returns are very much higher. These large yield gaps indicate the potential of raising productivity across the province by using better seed, site specific fertiliser mixes, and improved cultivation methods.

Published in Dawn, April 20th, 2018